US billionaire threatens to expose Turks and Caicos corruption Apparently prompted by efforts by the British-led civil recovery team
(CRT) to recoup unpaid stamp duties, Boston attorney Michael Flynn,speaking on behalf of US billionaire Timothy Blixseth, said he intends to
expose all the corruption in the Turks and Caicos Islands.
This statement and others resulted from allegations that Blixseth sought to escape $1.7 million in stamp duty taxes on an upscale Turks and Caicos property he purchased in 2005, when the Michael Misick-led government was two years into its first term in office.
The CRT is not only attempting to recovery the $1.7 million in unpaid stamp duty owed to the TCI government but is also assessing a penalty of US$7 million for withholding the full amount.
It appears Blixseth’s position is that Misick and his government, in league with the seller, somehow manipulated the duty or proceeds to the
seller in their personal favour.
In todays news posted by Caribbean News Now, Attorney Flynn is quoted as saying, ‘The corrupt government of Michael Misick and the seller of the property (Gary di Silvestre), appear to have played some role in the original stamp tax transaction.’
The statements attributed to Flynn were reported in a Bloomberg Businessweek article published December 13, 2010.
The property, located on a small cay off the Chalk Sound/Silly Creek area of Providenciales, reportedly sold for $28 million. The documents listing the transaction in 2005 listed the sale at only $10 million. Stamp Tax is assessed at 10 percent of the purchase price. The tax paid was
approximately $1 million but allegedly should have been $2.7 million. A civil action has been filed in the Supreme Court to resolve the matter.
Attorney Flynn is reported to have denied that Blixseth ever saw or signed the original land transfer document.
The property, known as Emerald Cay, includes a 30,000 square foot home with a 3-story great room, 9 bedrooms and 3-story library. An award winning entertainment room, a 6,000 bottle wine cellar, 2 swimming pools, tennis and volleyball courts, a manmade beach and a marble driveway are included. The property is accessed by a remote control swing bridge from Providenciales.
The property was later listed for sale by Blixseth for $75 million then later reduced to $48 million.
Just this week the TCIG noted that it issued civil proceedings against Emerald Cay Limited, Worldwide Commercial Properties Limited, Timothy Blixseth and Andrew Hawes arising out of the substantial under payment of stamp duty owed on the acquisition of land parcel number 60400/219 known as Emerald Cay in Chalk Sound, Providenciales on 3 December and that those
proceedings have now been duly served.
TCIG’s claim against the Defendants alleges that by a series of agreements of no or little practical or commercial value they concealed the true
value of the consideration paid for the Land in August 2006 leading to an underpayment of stamp duty owed under the Stamp Duty Ordinance. TCIG alleges that the true consideration paid was $28 million whilst it was recorded on the Land Transfer Certificate as just $10 million and that the Defendants conspired together to enter into a scheme to avoid payment of stamp duty of $2,730,000 properly due, instead paying just $975,000.
TCIG in its release on Monday of this week, said it is seeking a declaration that adequate stamp duty was not paid and that the Defendants
are liable for the outstanding stamp duty of $1,755,000, as well as a penalty of $7,020,000 under section 8(c) of the Stamp Duty Ordinance, as well as damages, interest and costs. This represents the latest set of proceedings issued by the Civil Recovery team since they began their work at the end of 2009, and the first set of proceedings in connection with the avoidance of stamp duty.
The Civil Recovery team is now involved in a substantial number of active recoveries and further sets of proceedings are expected to be brought.
